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Maybe it was somethign as simple as you missed a deadline for dropping off the paperwork. Our school operated that way. Shit liek that was always a scare tactic. I cant tell you how many times we had "officially lost university recognition" because we didnt turn in our Registerd Student Org. Packet each semester by the deadline. They always took it late and it was all cool.
As for NIC, it was always my understanding that penalizing a chapter through recruitment penalties was THE TABOO. It was to NEVER be done - kinda a hit below the belt.
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